French lawmakers soften iTunes Law

According to the report, the compromise text, approved by a joint committee of senators and National Assembly lawmakers, stops short of many of the tougher proposals adopted by the lower house.

The Assembly in March had backed proposals to force companies like Apple to share their copy-protection schemes with competitors. This would have allowed iPod rivals to play songs downloaded from Apple's iTunes Music Store and tracks purchased outside of iTunes to be played on the iPod.

However, the AP reports that the compromise text includes a loophole that allows compatibility restrictions on music and video downloads to be decided by the primary content holders — potentially allowing Apple and others to sidestep the information requirement by forming agreements with record labels and artists.

The draft law, which is still subject to final vote by both houses, would employ a new regulatory authority to resolve disputes by ordering companies to license their exclusive file formats to rivals if the restrictions they impose are "additional to, or independent of, those explicitly decided by the copyright holders."

According to the AP, the draft law also introduces new penalties for a range of online piracy offenses, including a maximum three-year jail term and 300,000 euros ($380,000) fine for knowingly offering or advertising an illegal music download service.